Ask Us Anything: Does Everyone Need a Side Hustle? + The Biggest Story of 2025?

0:28I'm Adam Schwab. for you I've been grappling with for some time. The media and politicians are obsessed with price gouging, but history shows that it's always targeted at market sectors with demonstrably tiny 3 to 5 % margins like supermarkets, petrol stations, and airlines. I find it entirely illogical that so many in the community grab the pitch. He's written pitch porks, but I assume he means pitchforks under the guise of cost of living crises, yet other market sectors spruik 70 % plus profit margins like technology and don't attract the same attention. If anything, it's the opposite and it's celebrated.

1:08How do you guys define price gouging and what do you think the line actually is? Does it exist at all in a capitalist society? Well, you know, there's two separate questions. Why does the government target these industries and what's price gouging? The first part of the question is so easy. It's the simplest question ever. I always say this is what the order of concern that politicians have. One, get elected or stay elected. Two, get even. Three, everything else. Basically, they just want to get elected or stay elected. And people that go to the supermarket and there's been inflation and the price has gone up, they're angry.

1:47And they want to channel, and same with petrol stations and same with banks, they all often target banks. And so they go and find the things that people interact with every day that feel like these big, amorphous, emotionless, depersonalized entities that are getting more and more expensive and stressing them out, going to the supermarket, for example. And then they just publicly attack them because that provides an outlet valve for society's anger. Nothing is going to happen. I mean, there's no outcome of any of this. But it's like just if bread and circuses is the way to give people happiness to distract them from their day-to-day problems, then maybe I would say price gouging investigations against supermarkets is the way to channel anger as a way to distract from the day-to-day problems of the world.

2:38I don't think it's connected to reality in any way. I mean, you think that's too cynical, Adam? I think that's right. I certainly come to supermarkets that's right. The supermarkets are a relatively low margin business, certainly the non-media side of the supermarket. So that's pure populism dressed up as monopoly, which is – I think with banks, there's more of an argument, probably less so now. Certainly banks in the early 2000s, they were charging fees for everything. Like every account, you get a monthly fee, you get a fee for this, fee for that. That's 100 % margin sort of stuff that was purely captured, high switching cost customers who weren't understanding what they were doing.

3:12that's largely being cleaned up and you don't really see that many bank fees now other than outside mortgages so i think it was actually right with banks because i think banks were somewhat taking the piss but i think that's been cleaned up i think the argument with supermarkets is actually absurd and we saw it post-covid so what we saw was politicians essentially blaming companies for their own stuff ups and that was politicians and especially central banks allowed massive inflation through huge fiscal stimulus predominantly and really weak monetary policy. So during COVID, we had basically zero interest rates and we had hundreds of billions of dollars of money printing happening essentially.

3:48As we've talked about countless times on this show, what happens when you print money or when you increase the money supply? That has to go somewhere and it goes eventually into asset prices and consumer prices. Rational businesses are simply increasing the price to the equilibrium point. So you can't criticize a business for optimizing its profitability. Otherwise, you'd be probably arresting the directors for breach of fiduciary duty. So the court, whether it's supermarket, whatever, getting the price of it. And I don't think supermarkets even do it, but getting the price of a good to its equilibrium point is what every business is essentially paid to do.

4:17So that's very different to being in a genuine monopoly where you've got huge switching costs and you're literally reaming the customer. So what we saw post-COVID was not price gouging. What we saw was post-COVID was incompetent politicians creating too much money supply and then realizing they stuffed up. And instead of taking responsibility for it, they blamed corporations who actually in this case weren't in the wrong. And now let's talk about what price gouging actually is. So I think a typical example of price gouging would be a situation where there is a lot of demand, especially a sudden increase in demand, and the consumer, it doesn't matter if it's a business or a regular customer, doesn't have much choice on where to get supply from.

5:02And so what the company does is they say, we're going to take advantage of this demand and we're just going to jack prices. And so the number one easy to understand example, although quite imperfect, because there are options, is Uber's surge pricing. You could argue that's price gouging. They would argue it's a way to get supply. And by the way, you've got other options because there's taxis. Maybe your experience with the taxi after whatever you went to the Australian an open or concert or whatever, where there were every event, there's four taxis and there's all this demand and there's no alternatives because, I mean, you found an Uber eventually.

5:39And so they say, instead of going by the meter, we're just going to charge you four times the meter. That's classic price gouging, I would say. But you really need, in order to execute effective price gouging, you need a temporary monopoly or a permanent monopoly in order to do that. And so I think that the most common place you might see it in society now is around poorly regulated monopolies or loosely or inadequately regulated monopolies. So car park pricing at an airport might be an example of price gouging, although that's more of a long-term demand issue than a short-term spike, but that would be an example of that type of thing.

6:21I think the greatest example of price gouging would be scalping concert tickets would be the greatest example of price gouging. And that's illegal. So I do think it can exist in a capitalist society. I think unbridled capitalism will lead only to price gouging because all industries will tend towards being monopolies, in my view, over time in unbridled capitalism. That's why we've got regulation. But I do think that where they generally take aim is mostly not where there is price gouging. Banking, for example, Like on the one hand, it's an oligopoly and you might argue that the banks move in unison, but there's so many alternative places to borrow money from now to get a mortgage other than the big four banks or to deposit your money that the effectiveness of them price gouging would be limited now because of the competition in the market.

7:09That'd be my view. I think it's a lot better. I think where you still see inverted commas elements of gouging is when they're very quick to increase rates when rates go up, but very quick to drop rates, certainly when they go down. And also, they're very quick to change the mortgage rate, but not change the deposit rate. So let's say interest rates go up, the mortgage goes up, your deposit rate might not go up the same amount. So that's where probably there's an element of gouging still, but I think the banks have gotten a lot better in the last 20 years. I think my final view on this is the main price gouging that occurs in our society is driven by bureaucratic or government organizations or statutory authorities.

7:47We've got the most expensive passport on planet Earth. I say that literally. It just went up another$10. That is price gouging because there is huge demand for Australians to get passports. We are very significant portion of the Australian population travels overseas, much more so than most other countries. I can't go and get a passport from somewhere else. I can only get it from the government. I don't have another option. And so the government jacks prices to take advantage of the demand. And I have no supply optionality. so I just have to cope with that. Government and statutory authorities have got much more opportunity because they are – like the passport office is effectively an unregulated monopoly and so they can price gouge.

8:29I think it's not just passports. We're one of the highest taxed countries on earth. It's not just – and this is even going from local government level where I'm paying tens of thousands of dollars in rates a year to effectively get my rubbish collected. So it goes from local to – certainly Victoria got – the highest sort of work cover costs in the world, the highest payroll tax. And then obviously at petrol level, we've got some pretty significant taxation. It's not the worst, maybe not quite Nordic state levels, but we're not far off it. So one of the highest taxing countries in the world, there's a classic gouging.

9:00But all licenses in this country feel like they're gouged. Like you think about car registration, you know, the best, most effective form of price gouging is where you go to jail or die if you don't pay. Car registration, if you don't pay that, then you don't have third party insurance, that's a catastrophe. I think, sorry, I think you do have third party, you don't have something else. Look, there's some disaster if you don't pay your car registration. You have to pay it if you're driving. An unregistered vehicle is a catastrophe. Now, they can pretty much charge any amount of money they want because it's an unregulated monopoly.

9:30You can't register with somewhere else. And so I think rather than looking at the private sector, to point the finger of price gouging in Australia, look to anything that is owned by governments where the only place to buy it is from them. And if you don't buy it It's a disaster. And that is where mostly you'll find price gouging. The one thing I do that is probably the worst is ASIC. So if you think in the UK, Companies House, which is the GAC6 sort of equivalent, you can get any financial information on any company for free. ASIC, you spend$60,$80 to get actual company info, which is meant to be for people transacting so they don't get ripped off by companies that are going brass.

10:07So this is outrageous that ASIC charges so much to people when the UK is completely free. The biggest gouges in Australia are the Australian government, unquestionably. So I would say if the government really wants to do the right thing and somehow blend the populist demand for a public hanging with something that might actually be legitimately price gouging, they should just go and do an inquiry into all car registration in all states in Australia and territories. And that will fulfill both of those. But unfortunately, they probably won't make a lot of friends amongst the premiers, especially the ones in their own party.

10:39And so you can bet that is never going to be happening. Moving on, question number two, Mike. All right, guys. Question number two this week comes in from Kelly on LinkedIn. Kelly asks, with more Australians working multiple jobs just to stay afloat, has the idea of a full-time wage quietly stopped meaning financial security? Keen to hear your thoughts. Are people working more jobs now? I'm not sure I know the answer to that. From my perspective, you know, as someone, again, a bit younger than you guys, I have noticed a lot of... Roughly the same as me. Okay. I have noticed a lot of sort of my friends or wider circle engaging in a lot of side hustles or just ways to bring in extra income because they're just not able to afford everything on their full-time salary, if that's any context for you.

11:40Okay. Well, interestingly, as you were saying that, I just had a very quick look. And it turns out post-pandemic, it is true. Young people in particular are increasingly working multiple jobs. So I think that's a great question. The answer that I'm going to say is really, let me just flag and say, it's based on no data, as I've made clear, given I just Googled that while you were talking. but when I think about a lot of the jobs that have appeared over the course of the last post-pandemic type of period or maybe even over the last 10 years what you've seen is the rise of the gig economy and the gig economy the law still has not exactly adapted to the gig economy like for example sometimes a contracted worker is considered to be a permanently employed worker and has to have a whole lot of entitlements and sometimes they don't and sometimes they do and they shouldn't and the law is still adapting to that it would not surprise me in any way based on the conversations i've had with uber drivers for example and uber eats deliverers that if those people could not sustain a living wage for a decent lifestyle not a great lifestyle for a decent lifestyle based only on working that job and so that job in a lot of cases where i've spoken to people that is their second job driving these ubers their primary job can be something totally different.

13:03One guy is like a guy in IT, like he had a mid-level role in IT, and then he would drive these Ubers like for a few hours every week to make some extra money. So I definitely think the overarching issue here is all of this inflation has meant that things have become more and more expensive. And whilst wage growth has kept up, the truth is that what governments want to do when they're panicking about inflation is de-link the rise of wages to the rise of inflation because that is the cycle that endlessly increases inflation. And so wage growth, unless you're in the public sector, certain parts of the public sector, which is a great place to be, wage growth has generally trailed inflation over the last three or four years.

13:50And it's not surprising to me that people can't keep up. And that is, This is Adam is going to go on one of his tirades, as he should. This is the problem with inflation, right? Like people that do not have assets and do not have capital in capitalism and are relying on a wage and are getting taxed, they are the ones most exposed to a rise in inflation. Yeah, I think that obviously inflation point is a really good one. I think the biggest trend we've seen probably over the last 30 years, actually I'll go back to 1978, and that is female participation in the workforce. we talk about sort of house prices going up and house prices going up as a percentage of income and what we've seen is instead of having and i'm not saying this is a bad thing by the way that females i think it's a great thing that females going to the workplace but what we're basically needing is two people in a relationship be it female male or male male or female female whatever it is two people in the relationship needing to work versus one person needing to work and again no issue with people more people working but we've seen no increasing no materially increasing living standards for double the people working if that makes sense if you look at in 1978 the female participation rate was about 44 % and male was about 80%.

14:58Now male is about 73%, so it's dropped a little bit pretty consistently, and females up to about 63%. And that's continued to rise. We're sort of 61 % pre-COVID. So we've seen, and that's almost been linear, the increase in female participation rate since then. So we've had a 50 % increase in females in the workforce and males dropped off a little bit, but we're seeing a lot more people working to try and effectively make ends meet. And then I think to the questions answers point, that's the next level up where not only have you got both people in a partnership working, you've got people working potentially two jobs or three jobs on top of that.

15:33And I think the gig economy one's a really good point. I remember hearing probably in 2017 when UberX started in Australia and we've been to the Catch of the Day guys and they were saying they had a warehouse in I think Traganina at the time. And I remember them saying that people would on their drive back from Traganina to wherever they lived would pick up people in the Uber. And I couldn't believe that. I said, oh, people are working two jobs. And now you wouldn't think twice hearing that, to your point. So I think the question's a really interesting one. I think there's definitely, not only has there been people working multiple jobs, you've now got a lot more people working as well.

16:07So essentially, if you look at the overall standard of living, which is, people talk about economic growth and all this, how great economic growth is, but really standard of living is where the rubber hits the road. That's the most important thing. If you have to work 80 hours to maintain the same standard living that you used to work 40 hours for, that's a really bad result. Inflation's that sort of ogre that sits above all this stuff that you need to work two jobs to afford what you used to work one job for. So that's why inflation is so bad, especially for the lower and middle classes. I think it's a really great question that really captures a lot of the issues we're having in society that nobody really talks about, that we're having to work a lot harder for the same level of import?

16:45Well, you know, we are going to see some real wage growth. It probably has already started because inflation's come back. So I think real wage growth will kick in and things might ease a bit now for people. But, you know, I don't know if you're familiar with this, but there's, I don't want to call it a meme because it's more of like this economic, you know, hypothetical, which is, you know, the Simpsons family. So the way the Simpsons live is they live with one parent working a job like and it's not it's a blue collar job well it's somewhere between a blue and a white collar job i'd say it's a white collar job being performed as if it was a blue collar job at the nuclear plant the mum is a homemaker stay at home mum whatever it's called now and they live in a freestanding house with a lot of bedrooms and have two cars their kids go to look obviously the public school they also have two pets for what it's worth they have two pets a great point.

17:43That's a great point. They've got two pets and they live like not in a city, but in a large size town. You know, Springfield, obviously there's a lot of Springfields in the US. It's meant to be typical of like any town. Well, it's the most common town name, which is why they used it. And so quite a while ago, economists, this is not a new concept, like quite a while ago, economists said, there is no way working like that could sustain that quality of life in the US anymore. That is gone. And I think when The Simpsons was created, like the reason it was created like that, it was so typical of US lifestyles at the time.

18:19And that tells you everything you need to know about whether life has gotten better or worse for the average family. It's American. Australia is better than that. Australians generally cluster in large cities as well. Americans are much more spread out across the country. But there is no doubt what you're saying is true, that the amount of income you have and the value of your assets is a much poorer measure of quality of life than things like how hard you have to work. Part of it is because people are trying to buy more and more expensive things. And just to whine about something that I whine about constantly.

18:51You know, I see all these people driving around and I can guess roughly what they earn. And they're all driving these Porsche Cayennes or whatever they're driving. And they're all on debt, right? And all of that debt, they have to work hard to pay for that debt. And houses, you know, people are buying houses, I get it, they're expensive. There is just so much debt that has been taken, all of which needs to be serviced, a huge amount of which is being spent on depreciating assets. That is part of the reason why it is so hard to make enough money to make ends meet now. It's not the only reason, but definitely has contributed significantly.

19:27I think just thinking before we move on to The Simpsons, that's now what, 36 years old? I think it came out effectively 1989. 36 years from 1989 going back from there was 1953. So think how long that's been around for and think 36 years back from when Simpsons started and how much life changed between 53 and 89 and then from 89 to 2025. It's been a long time. Obviously it's been the longest running show in TV history for a reason. It's true, but it became unrealistic like a long time ago, like probably 15 plus years ago. It wasn't last week. GFC maybe? Yeah, I don't know. But there's no way, there's no way you could live like that now.

20:06Yeah. We'll go to a super quick break, but back in no time at all with our last question.

20:19And we're back. Question number three, over to you, Mike. All right, guys, this is our last Q &A for 2025. So I thought this was a great question to end on. It comes in from Campbell and he DM'd me on LinkedIn. Campbell asks, coming to the end of 2025, can we get both of your thoughts on what was the biggest business story of 2025? Plus, what was each of your personal and professional highlight of 2025? five. Wow. That's a very short window to answer these questions in. Well, this is just a bit of a little mini sneak preview of our very popular predictions episode, which you'll hear next week.

21:02So this is a nice little taster of it, I dear. I'll answer very quickly. I can't answer the biggest story. You're going to say a few bigger stories, Adam, and I'm going to pick which one I think is the biggest because I can't even remember yesterday. I'm not going to remember the whole year's worth of stories. I can answer the other two questions though, but there's a kind of, the professional question is kind of straightforward. It is, I think this year, my memory is so bad. I think this year is the year the market finally woke up to what a great company catapult is. And I think that was my professional highlight for the year is just like that.

21:36Finally, the thing that we had known for a few years and had been working hard and finally the market woke up to it. And all of a sudden people realized, wow, this is like, This can be the next great Aussie tech success story. So that was a great feeling after so long in the wilderness. On a personal level, it's extreme sop what I'm going to say. But this is my personal highlight. It's not a moment. It is all of the people that I care most about are at least as healthy and at least as happy as they were when they started the year. That is my personal highlight. That's how I feel about every single year.

22:11nothing else in my entire life matters even one percent compared to that outcome and so that is the way that i generally tend to evaluate a year maybe it's a slightly hopeless answer but that's how i feel about it i think it's a good answer and big congratulations on catapult's performance this year which has been pretty epic one of the the best performing businesses on the asx over the last decade and also big big reason comes down to you and and the founders and obviously the ceo so big congratulations on that i think if you look at the biggest stories of the year I'm going to take a global perspective.

22:41I think the AI story is probably the biggest one and it impacts us. So you've got the sort of first order effects, which is what business has been impacted by AI, who are the winners from the AI story, who are the losers, and then how does AI impact our day-to-day life? And I think to me, the biggest impact, and I talk about a lot, the biggest impact of AI is in self-driving cars. That's where the rubber is hitting the road now. We haven't really seen it in business operations as much yet. Like it's definitely coming and smart businesses are getting ahead of it now, but I think most businesses are still finding their way with the use of llms essentially yeah we're becoming more efficient with coding we're becoming a bit more efficient operations but ultimately that's sort of still around the edges i think it's sort of avs autonomous vehicles where we're seeing and certainly it's happening in the us much quicker than australia with waymo at sort of 500 000 rides a week i think now but that to me is the biggest impact of ai and obviously you got nvidia being still the most valuable business in the world and you gave this great background into AI two weeks ago, but how was that impacting the rest of the economy from data centers to neoclouds to glassmakers in Germany to the whole ecosystem around AI?

23:45So to me, that's been the story of 2025. I would agree with that. And I think we'll talk about the biggest transactions and the biggest deals and stuff on the regular episode, won't we? We will. Obviously, we'll review our predictions from last year and make our predictions from this year. So who got it right? Who got it wrong? A dear who famously criticizes his own predictions, but you usually get it pretty right. So we'll see. My predictions are terrible. I think you're too humble. I don't know if that's just a humble brag because last year you were very accurate. So what I do is I go through the episode last year and take some pretty copious notes and we'll obviously play it back.

24:19So I know a lot of listeners love hearing where we got it wrong and occasionally where we got it right. And ultimately with predictions, the whole point of predictions isn't to get it right. It's to catalyze conversation, as Scott Galloway says. So we know we're never going to get 100 % right. We may not get any right, but ultimately we want to try and sort of catalyze thought and get people thinking about the right sort of stuff and how you run your business and how you run your investments across the year. What's crazy, just to finish that, I would say the biggest story of the entire year in Australia has been this terror attack.

24:52It's come at the end of the year. The biggest political story of the year has come after the end of Parliament sitting, which is all of this, you know, we've all forgotten about the flights and travel scandal before this terror attack. That was the biggest political story of the year. And so like things seem to have come really late in the year, tragically and like politically, like, you know, intriguingly. It's been a crazy end to the year this year. We forget Australia had an election in, I think it was March or April. US had an election just over a year ago that they've both been completely forgotten about.

25:27Obviously, we also had liberation day this year that was in april that was only eight months ago so that was probably the second biggest business so tariffs and liberation is the second biggest business story the only thing anybody predicted the impact that would have initially and it's now sort of physical away that the most terrorists they still exist there's tariffs on canada at pretty significant levels there's some tariffs on china there's tariffs on india for example also we had the called the relative peace in gaza as well that's now sort of two three months old so actually has been a lot of stuff that we've sort of just almost taken in our stride this year, which is actually pretty incredible.

26:01Because with Trump, you can't say what's been the biggest story of the year. You have to say what's been the biggest story of the day with Trump, don't you? As long as he's in power. We'll talk about it on the main episode. Just quickly, in terms of a personal highlight for me, I can't think of anything myself, but certainly I think my kids have had a really great year and my wife's done really well. She's now, as I said, a couple of weeks ago, going back to uni. So I think not less so for me, but certainly from the rest of my family's done really well and from a luxury perspective we've had a record year our team's better than it's ever been uh and super proud of everything they've done so they're probably the highlights i don't think i've done anything particularly special myself but uh otherwise other than obviously working with you guys um but certainly from a from a family and and business perspective it's been a pretty great year across the board we can say the highlight of our professional life is that i don't know if this is professional or personal but that people still want to listen to this podcast that's the highlight of my life well and more so so which is uh which is we we got we got really low churn and obviously our audience keeps growing year on year so we are super grateful to all our amazing listeners for sticking with us so it's been a big year a great question we'll obviously go through it in great detail in our big predictions episode next week uh thank you to our again our fantastic question askers we always appreciate you taking the time and we do get some incredible questions from obviously the world's smartest podcast audience so thank you again we'll see everybody for our big episode on tuesday